The Edmonton, Alberta, City Council on Wednesday voted unanimously to walk away from a proposal to build a new arena in the Canadian city, reviving chatter about owner Daryl Katz potentially relocating the Oilers franchise. Katz and others from the Oilers ownership group have also met with leaders in Hamilton, Ontario, and Quebec City, Quebec, according to reports.

“We are concerned about the implications of the motion passed yesterday by the city council,” Katz said in a statement Thursday, as reported by NHL.com. “We do not yet have a view on what comes next, but we remain hopeful that there is a solution that achieves the mutual goal of securing the Oilers’ longterm sustainability in Edmonton.”

The Oilers’ lease at aging Rexall Place is set to expire in 2014. The team and the city of Edmonton had agreed on plans for a $475 million arena, with construction beginning next year. But now that Katz has asked taxpayers to chip in at least $210 million more than originally proposed, the deal has collapsed.

On Sept. 24, the same day members of the Oilers ownership group were in Seattle, the Seattle City Council approved a public financing plan for the $490 million venue proposed for Sodo by investor Chris Hansen. The deal was finalized this week after the City Council and King County Council agreed on the same “memorandum of understanding”; Mayor Mike McGinn and county Executive Dow Constantine signed the arena legislation Tuesday.

“As the City of Edmonton is aware, the Katz Group has been listening to proposals from a number of potential NHL markets for some time,” the Oilers said in a statement Sept. 24, as reported by The Associated Press. “After more than four years of trying to secure an arena deal and with less than 24 months remaining on the Oilers’ lease at Rexall Place, this is only prudent and should come as no surprise.”

According to reports, many Edmonton fans were angered by the Seattle trip. Katz ended up apologizing to them in full-page newspaper ads — but he didn’t say he wouldn’t move the Oilers.

Hansen, who wants to acquire an NBA franchise for Seattle, wants a business partner to do the same with an NHL team. Under the city’s arena agreement, the multipurpose venue would be built to accommodate basketball and hockey games, plus concerts and other community events.

Seattle’s arena plan includes up to $240 million in public financing in the form of bonds from the city and King County. The governments would essentially give loans to Hansen’s group that would be paid back over 32 years by team rent at the new venue and by existing taxes on arena operations; no new taxes would be created, so only people who use the arena would help pay for it.

Edmonton Oilers owner Daryl Katz. (Getty Images)

After the approval this week, next up is a state-mandated environmental study to see how the new arena would affect the Sodo neighborhood, including transportation issues and traffic conflicts with the Port of Seattle and other nearby businesses. The process, which is expected to take about a year, will also look at alternative sites for Hansen’s arena — other than the swatch of land he’s already purchased south of the Safeco Field parking garage.

Based on the results of the study, the city and county councils will have the chance to choose whether to go ahead with the arena deal or walk away from it. Meanwhile, the local Longshore Union on Thursday filed a lawsuit against the city and county to block the Sodo arena.

Construction would not start until Hansen has locked down an NBA franchise as an arena tenant. The addition of an NHL team would trigger extra public financing, mainly through a larger bond contribution by King County.

Relocating teams to Seattle would require approval by the NBA and NHL. On Thursday, NHL Commissioner Gary Bettman downplayed the implications of Edmonton’s arena woes, according to NHL.com.

“I think everybody needs to take a deep breath,” Bettman said. “The Oilers need a new arena, the city of Edmonton needs a new arena and I’m hopeful that, despite the breakdown in negotiations, reason will prevail and we’ll get it to the right place.”

Tell that to SuperSonics fans who sensed doom when new team owner Clay Bennett said he was committed to keeping the Sonics in Seattle.